Sharia finance part of capitalism
Various newspapers have in recent times reported the trend towards issuing sharia compliant finance. This has extended to proposals to issue Sharia compliant government bonds. This has been depicted as either part of a move towards the introduction of Sharia law, or in some way a reflection of political correctness intruding upon finance. It is plainly neither.
This column has previously indicated in One law for all revisited and One law for all, why Sharia law can never be part of United Kingdom law. However the introduction of such finance is nothing to do with the imposition of a system of law. It has everything to do with capitalism responding to challenges and giving opportunities to all.
As long as the general law is not infringed there is no reason for example why (as long as it is free choice and not coercion) two Muslim adults cannot decide to arbitrate a dispute and that the arbitrator is to apply Sharia law. That is a choice properly available in a democratic society. Similarly, as long as it is consonant with the law, people are entitled to regulate their conduct as they see fit.
Even as regards the law, there are occasions when it can properly be altered to apply different standards to different citizens. The history of the different application of Sunday trading laws to Jewish traders (who were observing the sabbath on a different day and hence would otherwise have been improperly handicapped) is a case in point. Another is allowing Sikh motorcyclists to wear turbans rather than helmets. Both of these would generally be regarded (rightly) as reasonable responses to different cultures which did not infringe upon the general principle of application of the same law to everyone.
Use of Sharia finance is however even less controversial than these non-controversial matters, because it does not involve a change in the law. It is responding to the needs of a particular section of the community. It is no different in principle from the sale of kosher food or halal meat. It is capitalism seeking a way of obtaining finance. It makes good business sense to pursue all sources of finance possible. In order to do that you have to make the terms upon which finance will be provided attractive. Contravening someone's beliefs is hardly likely to make a deal attractive to them. Sharia compliant finance is doing no more than allowing funds to be raised from Muslims.
In principle one would expect a capitalist to pursue any form of change to the form or structure of the transaction necessary to give it economic advantage. It is no different from the principle which leads people to pay large amounts of money to have their business advertised on football shirts. This is with a view to wide public exposure and particular exposure to fans of a particular team. In other words doing everything possible to maximise business opportunities. So far from being a sop to political correctness, this is in fact a normal incident of ordinary business.
Nor is it of sinister cultural import here. Petrodollars are big business. There is plenty of money available from Islamic countries. Tapping into that money in the most acceptable way possible is ordinary commonsense. It would still be business commonsense even if there were no Muslims living in this country at all. Put bluntly, if one country in the world was in practice only prepared to lend monies on loan agreements printed on pink sheets, it would be business sense, not political correctness, to cater for this market.
One of the great benefits of capitalism and international trade and finance, apart from increasing prosperity, is that making money is a lot more fun than killing one another. The law should where possible facilitate business. In order to do that it should wherever possible facilitate involvement in business for people of all cultures and religions and nations.